Medical reform

Health care bill growing fastest in OECD

Korean policymakers presented the success story of its efficient medical system to Capitol Hill. When the Obama Administration was preparing to reform the health care system this year, Korea was one of the models chosen for benchmarking.

Even the reformed U.S. medical system needs retooling if it is to be more competitive and comprehensive than the Korean system.

Now the country should pay attention to the latest OECD advice. Many Koreans had long taken for granted the efficiency of its health-care system. The country could limit spending to one of the lowest levels in the OECD. Spending is now increasing at the fastest rate in the OECD, growing at double-digit rates since 1995. Every salaried citizen feels uncomfortable when they see their paycheck summary each month.

In addition, the country is becoming one of the fastest ageing societies in the world. The OECD has reported that Korea will become the most aged society among advanced economies in 2050, with nearly four out of every 10 Koreans being 65 or over due to low birthrates and the rapidly aging population. The population will fall from 2018. Between now and 2050, the nation will see a decline of 6.4 million people.

This should put pressure on medical costs. The National Health Insurance Corp. also plans to expand the range of services it covers.

Unless preemptive steps are taken, the medical service will be costly.

As the OECD suggests, the nation needs to raise its efficiency through reforming the medical payment system, slashing drug expenditure, shifting long-term care out of hospitals, promoting healthy ageing and increasing the number of general physicians, generally recognized as gatekeepers.

On top of the double-digit rises in medical insurance fees, patients should bear more and more out-of-pocket expenses. This would reduce adequate access for low-income households. The country also needs to increase the number of general physicians to provide less expensive and more effective primary care. The number of medical consultations per physician is more than three times the OECD average. The country has the highest number of physician consultations in the OECD.

It means doctors are in short supply in providing quality services to patients. As you well know, a consultation at a hospital lasts for less than 10 minutes. Instead of increasing the number of doctors, the country needs to expand the number of general physicians.

It may be naive to expect quality service at a low cost. Hospitals could reduce expenses through restructuring and enhancing transparency.

More incentives should be given to out-patients to reduce long hospital stays and frequent appointments with physicians.

The country has extra room for cutting spending on drugs. Recommended is a strong crackdown on illegal rebates by pharmaceutical makers and ways of reducing the price of generic drugs. As a way of igniting competition, the current rule requiring nonprescription drugs to be sold at convenience stores is advisable.